Tech giants at odds over Obama privacy bill

The giants of the tech industry are at odds over how the government should protect users in the era of “big data.”

While some companies are pushing President Obama to propose firm rules for data collection, others say the industry should be trusted to regulate itself.

Microsoft is among those calling for new federal standards, arguing Congress should act to craft “strong, comprehensive privacy legislation.”

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“Big data holds great promise for technology, for the economy and for people,” and privacy legislation “can and should be part of unlocking that promise,” the company said in comments filed last week with the Commerce Department that were published Tuesday.

But The Internet Association — “the unified voice of the Internet economy,” which includes Facebook, Google and Yahoo — took a different approach, calling for “a flexible and balanced self-regulatory responsible use framework” that protects consumers while allowing for innovation.

“We are concerned that any legislative proposal to address ‘big data’ may” harm “the advancement of technologies and innovative services before they even develop,” the group said in its comments.

The comments from tech and telecom companies, privacy advocates and others come as the administration looks to craft a privacy bill for the president to send to Congress.

In May, a report on “big data” from administration officials — including Commerce Secretary Penny Pritzker and White House adviser John Podesta — recommended that the Commerce Department bring together stakeholders to work on a privacy bill.

That bill would expand on Obama’s Privacy Bill of Rights, which was unveiled in February 2012.

The administration’s renewed push for stronger consumer privacy rules dovetails with pledges to rein in government surveillance.

In its filings to the Commerce Department, Microsoft said there is an “urgent need for privacy legislation that is suited to the big data era,” pointing to efforts in Europe, Asia and Latin America to enhance privacy protections.

Tech giants like Microsoft, Google and Facebook have pressured the U.S. to reform its surveillance policies and international agreements to ease concerns about the activities of the National Security Agency.

The revelations about NSA spying from former government contractor Edward Snowden have hurt the U.S. tech businesses in foreign markets, the companies say.

“Already, some customers for cloud services in foreign markets are turning towards local solutions instead of U.S. providers, precisely because they (and their regulators) do not trust to the sufficiency of U.S. privacy laws,” Microsoft said in its comments.

As other countries enhance their privacy rules, “the United States should not stand still,” the company wrote.

Microsoft said the government should update surveillance laws to help build confidence in the privacy and security of tech companies’ products and services.

“Quite simply, people will not use technology that they do not trust. And they will not trust the cloud if the government has easy and insufficiently controlled access to the data that is stored in it,” wrote the company, which is in the middle of a legal battle with the U.S. government over access to information stored in the cloud.

The Internet Association also urged the administration to work with foreign governments but pushed back on the calls for a privacy law.

While acknowledging the “challenging global business environment” in the wake of last year’s surveillance revelations, the association said it does not “support preemptive legislative action, which could disrupt future growth of the innovation economy.”

Instead, it encouraged the administration to reform government surveillance laws and promote the country’s current privacy framework as it applies to companies.

The Internet Association pointed to the benefits of “big data” and the voluntary agreements by tech companies and industry groups and sector-specific rules designed to protect consumers.

“Before taking steps to legislate, we encourage the Administration to conduct a comprehensive review of the United States’ privacy regime, including self-regulatory codes of conduct that the Internet industry abides by to ensure that users are protected online,” the group said.

“We are confident that this review will reveal the effectiveness of our current framework.”